Tired of Debt? Why Taking on Credit Counselling is a Good Idea

Posted by Auto Loan Solutions

Few things are worse than feeling trapped under your own debt. It’s like falling into a hole and trying to climb out, with rope and no rescue workers around you. And when you’ve got a mortgage, car payment, or student loans to pay off, the stress only makes your predicament seem hopeless. However, a lot of households forget about their lifelines. One of the best sources of advice and comfort if you’re dealing with crippling debt is by taking counselling courses for credit card debt. There is a trifecta of learning, enlightenment and freedom that comes from these programs, and you’d do your family a massive favour by learning how to improve your credit and reduce your debts.

The Curriculum

Depending on the experiences you’ve had with financial advisors, you may tell yourself that a counselling course on credit may seem like a waste of time. Perhaps, you feel the advice you’ll receive is stuff you’ve heard several times before. But a course differs greatly from a one-on-one session. What you’ll learn in a dedicated program resembles what you’d soak in from any classroom setting out there. In other words, there’s a lot to learn.

The Psychology Behind Spending

Science says our buying decisions are 80% emotion, and 20% logic. For people who feel intensely, the urge to spend on certain things can be overpowering beyond reason. With that said, such a mindset can cause problems. A debt counselling program can help you see why humans make the decisions they do when it comes to purchases, and how you can keep such feelings in check. You’ll learn a lot about yourself in the process.

Credit Card/Debt Collection

The majority of people don’t truly understand how credit and debt collection really works. And that’s troubling. There’s no wonder why so many people are surprised or shocked when they hear how at risk they are for credit troubles. They think everything is fine until their on the line with collection agencies. Fortunately, credit counsellors can teach you how “collections” works.

Budgeting Advice

Just about everyone who has debt issues has problems with their budget. If debt is a problem for you, it’s likely that your budgeting needs work. Perhaps it’s unrealistic or you’re just having a tough time following it. Or, you might be among those who don’t budget at all. Whatever the scenario, a credit counselling course will help you review and revise your budget (or create one if necessary) to see where you can make changes.

Options for Debt Resolution

Think bankruptcy is your only way out of debt? It’s probably not. Bankruptcy should be the very last option when looking to resolve debt, because of its long term consequences. A credit counselling program can open you up to other strategies and tools that can help you resolve a debt crisis. These alternatives gradually reduce debt without the far-reaching effects of bankruptcy. Some agencies will even offer debt negotiation, so that customers don’t pay interest fees (which we’ll show in an example soon).

Best Ways to Rebuild Credit

Another important aspect of credit counselling is the advice given to you for the rebuilding of credit. After all, a house flattened by a storm need not remain as rubble. Likewise, a damaged credit score is something you can rebuild no matter how low it is. By enrolling in a credit counselling program, you’ll learn what strategies will work best for you in an effort to improve your score.

What You’ll Gain from Credit Counselling

The beauty of taking a credit counselling course is that you’ll receive the tools needed to change your finances for the better. Since there are plenty of benefits along the way, your enrollment is worth all the time and money.

How You Win

Reduction in debt

Significant stress/anger/anxiety relief

Improved credit score

Avoiding extreme choices such as bankruptcy

Ability to save more money and invest

Daily expenses and commitments become more affordable

Learn vital financial lessons for the future

Those Who Made it Out

If the concept still only sounds good on paper, perhaps you need to hear some testimonials. The reality is that there are many individuals who need help to pay off their debt, and they’re receiving that help by reaching out to the right people. By working with credit counsellors, many of these people have been able to turn their financial troubles around.

The Never-Bursting Bubble

Back in 2011, CTV News Vancouver reported about Dan Robison, a recently divorced man whose credit card debt ballooned from $10,000 – $30,000 in just two years. He was paying $750 monthly on interest. Even if he paid $1000 a month on his credit card, it would take him 15 years to pay that debt off. Desperate for help, Dan turned to the Credit Counselling Society for guidance. His story took an unusual turn – a good one that is. Although not all credit counsellors will do this, the Credit Counselling Society negotiated with his creditors to take his interest payments from $750 per month down to zero. Dan went on to say, “Once I saw it going down, I could have hope. I could have dreams”, a common sentiment shared by those who work with credit counsellors. In just three years, Dan was able to pay off his debt.

Growing Family, Growing Debt

Also going back to 2011, is the story of Crystal Huck, who along with her husband reached out for financial help after they grew fed up of the $31,411 debt total they carried. This was their consumer debt, which included 4 credit cards and one line credit. After admitting they struggled to make the minimum payment, she went on to say, “He {my husband} didn’t realize we were dealing with that much of a struggle,” said Crystal. “I told him, if we don’t do this now it’s only going to get worse, and we’re never going to get better.”

To make matters even more stressful, was the fact that Crystal’s family was growing, and a daughter with severe allergies that added onto their financial woes. Despite these challenges, the family decided to enter the Money Mentor’s Orderly Payment of Debt program, a journey they started by cutting up their credit cards, vowing to live using cash alone. The result? In May 2015, Crystal and her husband are officially debt-free. Their consumer debt is completely gone, and they’ve paid for their vehicle – an incredible feat for just a 4-year time span. They’re planning to buy a new home to accommodate a 4th addition to their family.

Help is Around the Corner

It would be terrifying to fall into a hole or well with no signs of help. Not only would you be fearful and emotional, you would probably feel devastated. But if you heard the voice of a rescue crew telling you that everything will be okay and that help is on the way, you would no doubt feel an overwhelming sense of relief. When the rope descends for you to grab, you’d no longer feel like there’s no escape. Taking on a credit counselling program can make you feel free. You’ll learn how to separate good and bad financial habits, working to make choices that balance out your assets and debts. In time, assuming you keep up with the plan your instructors have helped you create, the financial freedom you strive for and deserve will be clear in sight.